Letter
Ottawa, 5 December 2006
File No.: 8638-C12-200602708
8678-C12-200615578
BY E-MAIL
Ms. Teresa Griffin-Muir
Vice President, Regulatory Affairs
MTS Allstream Inc.
45 O'Connor Street - Suite 1400
Ottawa , Ontario
K1P 1A4
iworkstation@mtsallstream.com
Dear Ms. Griffin-Muir:
Re: Review of proposals to dispose of the funds accumulated in the deferral accounts, Telecom Public Notice CRTC 2006-15
Pursuant to the procedure specified at paragraph 20 of Review of proposals to dispose of the funds accumulated in the deferral accounts , Telecom Public Notice CRTC 2006-15, 30 November 2006 , attached are interrogatories associated with this proceeding. These interrogatories are in reference to MTS Allstream Inc.'s (MTS Allstream) proposals to expand broadband services to rural and remote communities and to improve accessibility to telecommunications services for persons with disabilities, submitted to the Commission on 20 October 2006 .
MTS Allstream is requested to file its responses to these interrogatories with the Commission, and serve them on the interested parties to this proceeding, by 19 January 2007 . These r esponses are to be received, and not merely sent, by this date. In providing responses, MTS Allstream is requested to provide separate responses for each sub-part of each question.
Yours sincerely,
'Original signed by P. Godin'
Paul Godin
A/Director General
Competition, costing and tariffs
Telecommunications
cc: Michel Murray, CRTC (819) 997-9300
Interested Parties to PN 2006-15
ATTACHMENT
INTERROGATORIES TO MTS Allstream Inc.
5 December 2006
A. BROADBAND EXPANSION PROPOSAL
Consultation/community selection
101 In paragraph 21, MTS Allstream states that it consulted with the provincial government in Manitoba and took its concerns into account in selecting the final communities listed in its broadband proposal. Indicate whether MTS Allstream also consulted with other levels of government (federal or municipal) to consider other broadband expansion funding programs that were available in Manitoba . If so, provide details of those consultations, including which level of government, name and details of program, etc.
102 With respect to communities that would otherwise have been eligible for funding from the deferral account pursuant to the determinations in Disposition of funds in the deferral accounts , Telecom Decision CRTC 2006-9, 16 February 2006 (Decision 2006-9), provide the information in the table below for communities that were excluded on the basis of:
a) funding received or to be received from the government at any level - federal, provincial, municipal (specifying, for each community, the name of the government funding program);
b) the company's assessment that broadband is likely already available (provide details); and
c) any other reason (specify the reason).
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Number of phone lines
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Reason for exclusion
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Roll-out plan
201 Refer to paragraph 13 where MTS Allstream states that it currently provides broadband services to 85 percent of the population of Manitoba . Provide the following:
a) the estimated percentage of total Manitoba homes and businesses that will have access to MTS Allstream's broadband services, assuming that MTS Allstream's broadband expansion plan is completed as proposed; and
b) MTS Allstream's estimate of the total percentage of Manitoba homes and businesses that will not have access to MTS Allstream's broadband services, but will have access to the broadband services of other service providers, assuming that MTS Allstream's broadband expansion plan is completed as proposed.
Technology/financial information
301 With respect to the estimates of the number of premises passed in each community included in MTS Allstream's broadband expansion proposal:
a) describe the process used or records accessed to estimate the number of premises passed; and
b) identify the number of subscribers in these communities that have been excluded from MTS Allstream's proposal, indicating the reason for exclusion, such as technology limitations related to the long length of access loops, access loops loaded with a loading coil, line-of-sight restrictions, etc.
302 In Attachment 1, section 5.4.2.1, MTS Allstream indicates that digital subscriber line (DSL) access can be provided by a digital subscriber line access multiplexer (DSLAM) located at the serving central office (CO) or at a remote location. Where the DSLAM is in a remote location, backhaul to the serving CO could be provided using fibre or radio feeder facilities. Provide the following information for MTS Allstream's proposed access configurations:
a) Identify all major resource components required for the provisioning of DSL access from customer premises to the serving CO when the DSLAM is located at the serving CO and specify the unit costs and the associated cost drivers for each of these resource components. Identify the vintage of the data used to develop each unit cost and explain the methods used to express each of the unit costs in current dollars. In addition, provide the life estimate and survivor curve for each resource component;
b) Identify all major resource components required for the provisioning of DSL access from customer premises to the serving CO when the DSLAM is located at a remote location and requires fibre backhaul to the serving CO, and specify the unit costs and the associated drivers for each of these resource components. Identify the vintage of the data used to develop each unit cost and explain the methods used to express each of the unit costs in current dollars. In addition, provide the life estimate and survivor curve for each resource component; and
c) Identify all major resource components required for the provisioning of DSL access from customer premises to the serving CO when the DSLAM is located at a remote location and requires radio backhaul to the serving CO, and specify the unit costs and the associated drivers for each of these resource components. Identify the vintage of the data used to develop each unit cost and explain the methods used to express each of the unit costs in current dollars. In addition, provide the life estimate and survivor curve for each resource component.
303 In Attachment 1, section 5.4.2.2, MTS Allstream indicates that the backbone network transports traffic between qualifying communities and the broadband remote access server (BRAS), also referred to by MTS Allstream as broadband radius access server, at a regional aggregation site. In the schematic network diagram in Attachment 3, MTS Allstream proposes three alternative technology solutions for providing the backbone network:
i) Ethernet on fibre;
ii) Ethernet on wave division multiplexer (WDM); and
iii) OC-3 radio.
Provide the following information for MTS Allstream's backbone network technologies:
a) Identify all major resource components required for the provisioning of traffic between a serving CO and a BRAS at the regional aggregation site for the Ethernet on fibre solution and specify the unit costs and the associated cost drivers for each of these resource components. Identify the vintage of the data used to develop each unit cost and explain the methods used to express each of the unit costs in current dollars. In addition, provide the life estimate and survivor curve for each resource component;
b) Identify all major resource components required for the provisioning of traffic between a serving CO and a BRAS at the regional aggregation site for the Ethernet on WDM on fibre solution and specify the unit costs and the associated cost drivers for each of these resource components. Identify the vintage of the data used to develop each unit cost and explain the methods used to express each of the unit costs in current dollars. In addition, provide the life estimate and survivor curve for each resource component; and
c) Identify all major resource components required for provisioning of traffic between a serving CO and a BRAS at the regional aggregation site for the OC-3 radio solution and specify the unit costs and the associated cost drivers for each of these resource components. Identify the vintage of the data used to develop each unit cost and explain the methods used to express each of the unit costs in current dollars. In addition, provide the life estimate and survivor curve for each resource component.
304 In Attachment 1, section 5.4.2.3, MTS Allstream indicates that the Internet Protocol (IP) platform connects a regional aggregation site to the Manitoba core network and the MTS Allstream National core network. In the schematic network diagram in Attachment 3, MTS Allstream shows the high level view of its IP platform. Provide the following information for the IP platform:
a) With reference to the schematic network diagram in Attachment 3, identify whether the broadband costing analysis includes both the Manitoba core network and the MTS Allstream National network in all instances. Explain why both networks are required in the costing analysis; and
b) Identify all major resource components required for provisioning of traffic from the regional aggregation site, through the Manitoba core network and the MTS Allstream national network, and specify the unit costs and the associated cost drivers for each of these resource components. Identify the vintage of the data used to develop each unit cost and explain the methods used to express each of the unit costs in current dollars. In addition, provide the life estimate and survivor curve for each resource component.
305 Provide the requested information for each of the following components included in MTS Allstream's broadband expansion proposal:
- fibre and radio facilities and associated structures in the access network; and
- fibre and radio facilities and associated structures in the backbone network.
a) Describe in detail how the costs of each of existing in-place fibre and related support structures, existing radio facilities and related support structures, newly-deployed fibre and related support structures, and newly-deployed radio facilities and related support structures are determined and attributed to broadband access costs associated with a particular community. Provide details on the unit costs, vintages of costs, life estimates, structural cost factors, and cost drivers as appropriate. Further, provide the average working fill factors assumed for the in-place fibre and radio facilities with supporting rationale; and
b) Specify the percentage of overall fibre-related present worth of annual costs (PWAC) that is associated with in-place fibre in MTS Allstream's broadband expansion proposal.
306 In Attachment 2, Table 3, MTS Allstream provides community-specific capacity and capital expenditure (capex) information in which it has distributed the capital costs over the following three categories: Outside Plant, Central Office and Access. Provide a detailed description of all major resource components included in each of the three categories with supporting rationale.
307 In Attachment 2, Table 4, MTS Allstream provides community-specific sample present worth of costs, revenues and recovery information. In its costs, MTS Allstream provides capital costs for the following categories: Backbone and Access.
a) Provide a detailed description of all major resource components included in each of the two categories; and
b) Provide a mapping of the resource components specified for the Backbone and Access categories of Table 4 to the resource components specified for the Outside Plant, Central Office and Access categories of Table 3 in the previous question.
308 Provide the details requested below related to the cost studies for MTS Allstream's proposed broadband roll-out plan summarized in Table 1 of Attachment 2:
a) Provide a Detailed Summary of Phase II Costs table, using the format specified in the General Tariff Economic Study Report Guidelines of 13 May 2005 (Detailed Summary of Phase II Costs table), for MTS Allstream's broadband expansion program with breakdown of costs to categories. If any expense or capital items fall under the category "Other", provide a breakdown of the PWAC into the major resource components and a brief description of each component;
b) Provide the cash flows for each year of the study period for the following:
i) Capital expenditures broken down into the following categories (as noted in Attachment 1, sections 5.4.2.1 to 5.4.2.3): Access, Backbone Network, and IP platform;
ii) Revenues broken down into the following categories: retail broadband access, wholesale broadband access, wholesale backhaul; and
iii) Expenses broken down into the following categories (as noted in Attachment 1, sections 5.4.3 and 5.4.4): pre-introduction costs, maintenance, service provisioning, and billing activities, and any other expense categories.
c) If any of the capital expenditure categories in part b) above have End of Study value of zero dollars in the cost study, explain why the value is zero for each affected category;
d) Provide the demand for each year of the study period for retail broadband access, wholesale broadband access, and wholesale backhaul for alternate providers of service; and
e) For each year of the study period, provide the projected retail revenue per end-user (broken down by business and residential end-user), and wholesale broadband access and wholesale backhaul revenue per alternative broadband service provider.
309 With reference to MTS Allstream's cost study for its broadband access proposal, for each year of the study, provide the estimated monthly revenue and cost per subscriber for dial-up internet that were used in the calculation of the net revenue loss.
310 With reference to the cost studies for MTS Allstream's proposed broadband roll-out plan summarized in Attachment 2, Table 1, provide a revised Table 1 (MTS Allstream broadband roll-out plan) and a separate Detailed Summary of Phase II Cost table for each of the changes in assumptions specified below. If any expense or capital items fall under the category "Other", provide a breakdown of the PWAC into the major resource components and a brief description of each component:
a) 20 percent increase in take rates for wholesale and retail services for each year of the study period;
b) 20 percent increase in wholesale and retail average revenue per year for each year of the study period;
c) 20 percent reduction in operating expenses;
d) use of asset life estimates specified in Implementation of price cap regulation and related issues , Telecom Decision CRTC 98-2, 5 March 1998 (Decision 98-2), as amended by Telecom Decision CRTC 98-2-1, 20 March 1998, except for equipment for which no asset category existed in the proceeding leading up to Decision 98-2. Specify which equipment life estimates are not based on Decision 98-2 lives, specifying each life estimate used;
e) assume a working fill factor of 60 percent for existing in-place fibre backbone and access facilities and any other capital cost that relied on the capacity cost approach;
f) if MTS Allstream has included non-zero productivity increase factors (PIF), capital increase factors (CIF), or expense increase factors (EIF) in its broadband proposal, assume that PIF, CIF, and EIF are all zero for the study period. Further, specify the assumptions MTS Allstream had made for non-zero PIF, CIF, and EIF in its proposal; and
g) if MTS Allstream has assumed that its capital expenditures are ongoing expenditures in the cost study for its broadband expansion proposal, assume that capital expenditures are one-time in nature.
Retail and competitor services and rates
401 Refer to paragraph 6, where MTS Allstream indicates that it will shortly be filing a separate cost study for competitor service rates in support of its broadband proposal. Provide this cost study along with details, including the applicable rates, charges, and terms and conditions, explaining how MTS Allstream will allow access to deferral account funded facilities to other broadband service providers, consistent with the Commission's determinations in Decision 2006-9.
402 In Attachment 1, paragraph 10, MTS Allstream provides the rates and contract terms for the broadband retail services that would be offered in the qualifying communities.
a) Provide details of the maximum and minimum upload and download speeds that would be available for the various proposed services in the deferral account funded communities, in chart format; and
b) Specify, if applicable, how the services and rates available to subscribers of MTS Allstream's retail broadband services in the deferral account funded communities might differ from the services and rates offered to MTS Allstream's subscribers in urban areas.
B. ACCESSIBILITY PROPOSAL
Consultation
501 Refer to paragraph 26 in which MTS Allstream indicates that it sought opportunities to meet and consult with the Society for Manitobans with Disabilities, and other organizations representing persons with disabilities in Manitoba , including the CNIB regionally. Provide the names of the other organizations representing persons with disabilities in Manitoba with which MTS Allstream was able to consult.
Proposed accessibility initiatives
601 Refer to paragraphs 31 and 32 in which MTS Allstream proposes to use funds in its deferral accounts to improve and enhance the accessibility of MTS.ca.
a) Indicate whether a customer with a disability would have access to all of the same functionalities (e.g. ordering service, accessing account information, etc.) that a customer who does not have a disability would through the improved website. Identify and provide the rationale for any functionalities that would not be accessible; and
b) Describe what procedures would be put in place to update the website to ensure ongoing accessibility for persons with disabilities.
602 Refer to paragraph 31 in which MTS Allstream indicates that the MTS.ca project will involve the redevelopment of standard presentation methods to provide mechanisms that either provide improved compliance with W3C standards or provide alternative layouts for reader programs.
a) Provide examples of the alternative layouts for reader programs that MTS Allstream is considering; and
b) Explain why the alternative layouts for reader programs identified above are equivalent or superior to providing improved compliance with W3C standards.
603 In paragraph 33 of its submission, MTS Allstream proposes that the remaining funds that it would allocate to improving accessibility of telecommunications services be set aside for future use on specific accessibility projects. MTS Allstream indicates that it would submit additional proposals to the Commission as they are identified. Explain and justify whether it is consistent with Decision 2006-9, particularly the Commission's determinations in paragraph 116, to retain deferral account funds for future initiatives that have not been specifically identified as part of MTS Allstream's proposal.
604 The Commission notes that TELUS Communications Company, Bell Canada , and Saskatchewan Telecommunications have proposed, in their accessibility submissions, the introduction of an Internet Protocol Relay (IPR) service in their territories. Provide MTS Allstream's views regarding the feasibility of introducing an IPR service in its territory, using some or all of the deferral account funds that remain to be allocated to improve access to telecommunications services for persons with disabilities in Manitoba .
Financial information
701 In paragraph 3, MTS Allstream identifies the funding required to improve the accessibility of the MTS.ca website for individuals with diminished visual, auditory or motor capability. With respect to this estimated cost, provide the following:
a) The cost study assumptions, including:
i) financial parameters;
ii) portfolio loading factor;
iii) annual productivity increase factor; and
iv) annual expense and capital increase factors.
b) Regarding the proposed capital costs that are causal to demand and to service, provide the following information for each type of capital equipment:
i) associated costing methodology and assumptions;
ii) life estimates;
iii) fill factor values; and
iv) the vintage date of the raw data used to develop the unit cost inputs, an explanation of the methods and assumptions used to express each of the capital unit costs in 2006 dollars as appropriate, and retrospective cost increase factors, if any were used.
c) Regarding the proposed expenses that are causal to demand and to the service, explain how each of the expense estimates were developed. Include a listing of all activities and associated costing assumptions (e.g. time estimates, labour unit costs); and
d) Provide the annual demand by major demand drivers, if applicable.
Date Modified: 2006-12-05
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